Question
Straightarm Inc. is a calendar-year corporation. Its financial statements for the years ended 12/31/24 and 12/31/25 contained the following errors: 2024 2025 Ending inventory $15,000
Straightarm Inc. is a calendar-year corporation. Its financial statements for the years ended 12/31/24 and 12/31/25 contained the following errors:
| 2024 | 2025 |
Ending inventory |
$15,000 understatement
| $24,000 overstatement |
Depreciation expense | $6,000 understatement | $12,000 understatement |
Failed to record Unearned Revenue at 12/31/25: $7,000
Straightarm declared a cash dividend of $11,000 on 12/31/25. No journal entry was made in 2025. The dividend was paid on 1/3/26; Straightarm debited Retained Earnings and credited Cash.
12/31/25 Total Stockholders Equity is in error by:
Select one:
a.
$49,000
b.
$53,000
c.
$54,000
d.
$45,000
e.
$60,000
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